Code No. 1662
June 2, 2010
Osamu Watanabe, President
Japan Petroleum Exploration Co., Ltd. (JAPEX)
1-7-12 Marunouchi, Chiyoda-ku, Tokyo
To All Shareholders:

Notification of the Convocation toththe 40 Ordinary General Meeting of the Shareholders
The 40th Ordinary General Meeting of the Shareholders of Japan Petroleum Exploration Co., Ltd. (hereinafterreferred to as the “JAPEX”) will be held according to the details below, and we kindly ask for your attendance.
If you cannot attend on the day of the meeting, you may exercise your voting rights through a written document.
Please review the “Reference Documents for Shareholders Meeting” described below, and express your vote on
the enclosed Voting Right Exercise Form. When sending the Voting Right Exercise Form, please send so it will
arrive at our office by Tuesday, June 22, 2010.
Thank you very much for your attention and cooperation.
Details:
1. Date and Time:
2. Location:
3. Agenda:
Announcements:

10:00 a.m., June 23, 2010 (Wednesday)
Tokyo Station Conference “Sapia Hall” (Sapia Tower 5F)
1-7-12 Marunouchi, Chiyoda-ku, Tokyo1) Business report and consolidated financial report of the 40th Term (from April 1,2009 to March 31, 2010), and audit reports from the accounting auditor and Board of
Corporate Auditors on the consolidated financial report2) Financial report of the 40th Term (from April 1, 2009 to March 31, 2010)

Resolution items:
Item 1:
Appropriation of Surplus
Item 2:
Election of Two (2) Directors
Item 3:
Election of One (1) Corporate Auditor
Item 4:
Awarding Retirement Benefits and Condolence Money to Retiring Directors
Item 5:
Payment of Bonuses to Directors and Corporate Auditors*Upon on your arrival at the Ordinary General Meeting of Shareholders, please submit the enclosed Voting Rights
Exercise Form to the venue reception. Thank you.
*In case the Reference Documents for Shareholders Meeting, or business report, financial report or consolidated
financial report is modified, such modification shall be posted on the JAPEX website. (http://www.japex.co.jp/)
NOTE: This document is an abridged translation of the Japanese “Notification of the Convocation to the 40th
Ordinary General Meeting of the Shareholders” “Reference Documents for Shareholders Meeting” and“Financial Report” of JAPEX. This translation is intended for reference and convenience purposes only. In theevent of any discrepancy between this translation and the Japanese original, the original shall prevail. JAPEX
does not guarantee the accuracy and/or the completeness of this translation and shall have no liability for any
errors or omissions therein.

1

Reference Documents for Shareholders Meeting

Item 1: Appropriation of Surplus
JAPEX employs the basic policy of long-term, stable distribution of dividends in considering the retained
earnings for investment in new oil and gas reserves and the development of transportation systems, including
pipelines, as well as respecting the return of profits to our shareholders.
The 40th term dividends and other appropriations of surplus will be as follows:
1. Details Concerning the Year-End Dividends(1) Type of dividend property: Money(2) Distribution and total amount of dividend property:
20 yen per share of common stock
Total amount of dividends: 1,143,056,300 yen(3) Effective date of distribution of surplus: June 24, 2010
2. Other Appropriations of Surplus(1) Item and amount of reduced surplus:
Retained earnings brought forward: 15,000,000,000 yen(2) Item and amount of increased surplus:
General reserve:

15,000,000,000 yen

Item 2: Election of Two (2) Directors
In March 2010, Director of the Board Masaki Hattori resigned from his position. Also Director Chikao
Yoshida passed away in April of the same year. Furthermore, three (3) Directors of the Board (Tadatsuna Koda,Yoichi Ohta, Nobuzo Ichikawa) will resign upon closing of this general meeting of shareholders. In order tofill the positions, we kindly ask our shareholders to elect two (2) Directors.
The candidates for the Directors are as listed below:
CandidateNameBrief history, Position and responsibilities in JAPEX orNo.
(Date of birth)
Significant positions concurrently heldApr. 1974
Joined JAPEXJun. 2004
General Manager of Operations Dept.,
Development DivisionJun. 2007
Managing Executive Officer
Nobuaki Moritani
1Nov. 2008
Managing Executive Officer, General(February 2, 1952)
Manager of Sapporo Division Office (laterGeneral Manager of Hokkaido DivisionOffice)(up to the present date)

2

JAPEX shares
owned

1,000 shares

CandidateNo.

Name(Date of birth)2

Hitoshi Yamatoya(June 5, 1951)

Brief history, Position and responsibilities in JAPEX orJAPEX shares
Significant positions concurrently heldowned
Apr. 1976
Joined JAPEX
Jun. 1999
General Manager of Marketing & Sales
Development Dept., Marketing & SalesDivisionDec. 2001
General Manager of Marketing & Sales
Dept. I, Marketing & Sales DivisionJun. 2007
Executive Officer, General Manager ofMarketing & Sales DivisionJun. 2009Managing Executive Officer, General
Manager of Marketing & Sales DivisionNov. 2009Managing Executive Officer, General
800 shares
Manager of Marketing & Sales Division andGeneral Manager of Marketing & Sales
Dept. IIMay 2010
Managing Executive Officer, General
Manager of Marketing & Sales Division(up to the present date)<Significant positions concurrently held>
Director at JAPEX Energy Co., Ltd.
Director at TOHOKU NATURAL GASCO., INC.

As of June 17th, 2010, the candidate Hitoshi Yamatoya will serve as the President & Representative Director ofJAPEX Energy Co., Ltd., to which JAPEX is lending funds.
No significant interest-based relationship exists between the other candidate for Director and JAPEX.

(Note)

Item 3: Election of One (1) Corporate Auditor
Upon closing of this general meeting of shareholders, the term of office of Corporate Auditor Kisaburo
Ikeda will expire. We kindly ask our shareholders to elect one (1) Corporate Auditor.
The candidate for Corporate Auditor as listed below:
The Board of Corporate Auditors consented to this proposal.
Candidate
Name
Brief history, Position and responsibilities in JAPEX or
JAPEX shares
No.
(Date of birth)
Significant positions concurrently heldowned
Apr. 1966
Joined Industrial Bank of Japan, Limited
Mar. 2000
Director and Vice President at Industrial
Kisaburo Ikeda
Bank of Japan, Limited
1(May 25, 1942)
Apr. 2002
Advisor at Mizuho Financial GroupJun. 2006
Corporate Auditor at JAPEX(up to the present date)(Notes)1. No significant interest-based relationship exists between the candidate Kisaburo Ikeda and JAPEX.
2. Kisaburo Ikeda is a candidate for Outside Auditor.
3. Kisaburo Ikeda is appointed as a candidate for that post in the hope that he will contribute to our management
by utilizing both his wealth of management experience at financial institutions, etc., and deep insight, from an
objective perspective independent of the management team of JAPEX which is responsible for execution ofbusiness.
4. At the end of this general meeting of shareholders, Kisaburo Ikeda will have served as Outside Auditor ofJAPEX for four (4) years.

Item 4: Awarding Retirement Benefits and Condolence Money to Retiring Directors
In March 2010, Director of the Board Masaki Hattori retired from his position. In addition, three (3)Directors of the Board (Tadatsuna Koda, Yoichi Ohta and Nobuzo Ichikawa) will retire upon closing of thisgeneral meeting of shareholders. Furthermore, Director Chikao Yoshida passed away in April 2010.
Therefore, retirement benefits and condolence money shall be awarded according to the standards
specified by JAPEX in recognition of services during their tenure. We kindly ask our shareholders to allow
3

deliberation by the Board of Directors with regard to the specific amount, period and method of payment, etc.
Their brief histories are as follows:
NameJun. 2001
Jun. 2005
May 2006
Tadatsuna Koda

Oct. 2006
Jun. 2009

Jun. 2007
Yoichi Ohta

Jun. 2008

Jun. 2006
Nobuzo Ichikawa
Apr. 2007
Jun. 2006
Masaki Hattori

Jun. 2007
Mar. 2010
Jun. 2006

Chikao Yoshida
Apr. 2010

Brief History
Managing Director
Managing Director, General Manager of Marketing &Sales Division
Managing Director, President of Marketing & Sales
Division
Senior Managing Director, President of Marketing &Sales Division
Executive Vice President, President of Marketing &Sales Division(up to the present date)
Managing Director, General Manager of Exploration
Division
Senior Managing Director, President of Exploration
Division(up to the present date)
Managing Director, General Manager of Energy
Supply System Dept., and East Japan Pipeline ProjectDept.
Managing Director(up to the present date)
Managing Director, General Manager of Exploration
DivisionManaging Director, General Manager of Nagaoka
Division Office
Resigned from Director
Managing Director, President of Development
Division
Passed away

Item 5: Payment of Bonuses to Directors and Corporate Auditors
A total bonus amount of 87,000,000 yen (82,383,000 yen to Directors, 4,617,000 yen to Corporate
Auditors) will be paid to sixteen (16) Directors (including one (1) Outside Director) and six (6) Corporate
Auditors tenured during the fiscal year ended March 31, 2010, in view of the traditionally paid bonus amounts
and the performance of the fiscal year ended March 31, 2010.

4

Consolidated Balance Sheets(As of March 31, 2010)(Unit: millions of yen)Accounting titles(Assets)
Current assets
Cash and deposits
Notes and accounts receivable-trade
Short-term investment securities
Merchandise and finished goods
Work in process
Raw materials and supplies
Deferred tax assets
Short-term loans receivable
Other
Allowance for doubtful accounts

Amount105,569
24,314
19,774
17,669
4,632
386
5,398
1,336
28,534
3,532(10)

Noncurrent assets
Property, plant and equipment
Buildings and structures
Wells
Machinery, equipment and vehicles
Land
Construction in progress
Other
Intangible assets
Other

415,439
144,765
50,84819,31247,53914,955
7,263
4,846
7,450
7,450

Investments and other assets

263,223

Investment securities

246,141

Long-term loans receivable

15,377

Deferred tax assets

1,332

Other
Allowance for doubtful accounts
Allowance for overseas investment
lossAssets

6,211
(46)

Accounting titles(Liabilities)
Current liabilities
Notes and accounts payable-trade
Provision for directors’ bonuses
Other

Noncurrent liabilities
Long-term loans payable
Deferred tax liabilities
Provision for retirement benefits
Provision for directors' retirement
benefits
Provision for cost of abandonment
Other
Liabilities(Net assets)
Shareholders’ equity
Capital stock
Retained earnings
Treasury stock
Valuation and translation
adjustments
Valuation difference onavailable-for-sale securities
Deferred gains or losses on hedges
Foreign currency translation
adjustment
Minority interests

Amount21,986
5,914
104
15,966100,275
24,471
61,386
6,429
690
6,216
1,080
122,261

286,137
14,288271,858(10)
104,733
106,89624(2,186)
7,876(5,793)

Net assets

398,747

521,009

Liabilities and net assets

521,009(Amounts truncated to millions of yen)5Consolidated Statements of Income
From April 1, 2009
To March 31, 2010
(Unit: millions of yen)Accounting titles
Net sales
Cost of sales
Gross profit
Exploration expenses
Selling, general and administrative expenses
Operating income
Non-operating income
Interest income
Dividends income
Gain on sales of securities
Reversal of provision for loss on business ofsubsidiaries and affiliates
Other
Non-operating expenses
Interest expense
Loss on sales of securities
Loss on valuation of securities
Provision for cost of abandonment
Foreign exchange losses
Other
Ordinary income
Extraordinary income
Reversal of allowance for doubtful accounts
Gain on sales of noncurrent assets
Gain on change in equity
Other
Extraordinary loss
Loss on retirement of noncurrent assets
Impairment loss
Retirement benefit expenses for prior periods
Other
Income before income taxes and minority
interests
Income taxes-current
Income taxes-deferred
Minority interests in income
Net income

Amount179,752
125,467
54,285
10,39630,76913,119
720
8,669
264
35
2,574
291
88
11
890
686
206

12,264

2,176
23,206

17
0
1,279
242

1,540

378
575
265
158

1,378
23,3684,135
307(Amount truncated to millions of yen)

6

4,443
986
17,939

Consolidated Statement of Changes in Net Assets
From April 1, 2009
To March 31, 2010
(Unit: millions of yen)
Shareholders’ equity
Capitalstock

Balance as ofMarch 31, 2009
Changes of items
during the period
Dividends fromsurplus
Net income
Change of scope ofequity method
Purchase oftreasury stock
Net changes of items
other thanshareholders' equity
Total changes of items
during the period
Balance as ofMarch 31, 2010

14,288Retainedearnings

Valuation and translation adjustments

Treasurystock

255,499

TotalValuation
shareholders’ difference
equityonavailablefor-salesecurities(9)269,778
105,430(2,286)(2,286)(2,286)

17,93917,93917,939706

706

706(0)(0)(0)

Deferred
gains orlosses onhedgesForeigncurrencytranslation
adjustment

Totalvaluation
andtranslation
adjustments(0)(4,465)100,964

Minority Net assetsinterests

7,484

378,227

1,465

24

2,278

3,769

391

4,160

－

16,359(0)

16,358

1,465

24

2,278

3,769

391

20,51914,288271,858(10)

286,137

106,89624(2,186)

104,733

7,876

398,747(Amount truncated to millions of yen)

7Balance Sheets(As of March 31, 2010)(Unit: millions of yen)Accounting titles(Assets)
Current assets
Cash and deposits

Amount
66,736
3,032

Accounts receivable-trade11,964

Short-term investment securities
Merchandise and finished goods
Raw materials and supplies
Prepaid expenses
Deferred tax assets
Accrued income
Short-term loans receivable
Short-term loans receivable fromsubsidiaries and affiliates
Accounts receivable-other
Advances paid
Other
Noncurrent assets
Property, plant and equipment

5,069
4,466
4,298
400
1,073
52
28,494

Accounting titles(Liabilities)
Current liabilities
Accounts payable-trade
Current portion of long-term loans
payableLease obligations
Accounts payable-otherAccrued expenses
Income taxes payable
Deposits received
Provision for directors’ bonuses
Other

AmountNoncurrent liabilities
Long-term loans payable
Lease obligations
Deferred tax liabilities
Provision for retirement benefits
Provision for directors' retirement
benefits
Provision for cost of abandonment
Other
Liabilities

97,17024,471
71
61,432
5,676
635

4,432
1,287
890
411,777
124,789
10,481

Structures
Wells
Machinery and equipment
Vessels
VehiclesTools, furniture and fixtures
Land
Lease assets
Construction in progress
Wells in progress
Intangible assets

34,44017,60839,13548
3,510
12,418
95
7,013
73
1,412

Investment and other assets

285,576

Investment securities
Stocks of subsidiaries and affiliates
Long-term loans receivable
Long-term loans receivable fromsubsidiaries and affiliates

207,145
71,207
968(Net assets)
Shareholders’ equity
Capital stock
Retained earnings
Legal retained earnings
Other retained earnings
Reserve for overseas investment
loss
Reserve for mine prospecting
Reserve for special depreciation
Reserve for advanced depreciationof noncurrent assets
Reserve for explorationGeneral reserve
Retained earnings brought forward

19,445

Treasury stock

Software
Other138
1,228
44

Long-term prepaid expenses

1,451

Other

2,807

Allowance for doubtful accounts
Allowance for overseas investment loss
Assets

20
2,443
4,971
1,737
211
87
4

1,275

Buildings

Leasehold right

13,192
1,438
2,278

(24)
(17,424)
478,514(Amount truncated to millions of yen)

8

Valuation and translation
adjustments
Valuation difference on
available-for-sale securities
Deferred gains or losses on hedges
Net assets
Liabilities and net assets

4,564
316
110,363

261,390
14,288247,112
3,572
243,539399
18,20548
271
47,246
156,600
20,768(10)
106,760
106,73624
368,151478,514

Statements of Income
From April 1, 2009
To March 31, 2010
(Unit: millions of yen)Accounting titles
Net sales
Cost of sales
Gross profit
Exploration expenses
Selling, general and administrative expenses
Operating income
Non-operating income
Interest income
Interest on securities
Dividends income
Reversal of allowance for overseas investment loss
Other
Non-operating expenses
Interest expense
Loss on valuation of securities
Provision for cost of abandonment
Foreign exchange losses
Other
Ordinary income
Extraordinary income
Gain on prior period adjustment
Gain on sales of noncurrent assets
Reversal of provision for loss on disaster
Other
Extraordinary loss
Loss on retirement of noncurrent assets
Impairment loss
Retirement benefit expenses for prior periods
Income before income taxes
Income taxes-current
Income taxes-deferred
Net income

Amount131,082
90,79940,283
5,215
23,917
11,150
818
79
9,334
3,090
1,331
290
11
654
1,197
151

147
0
95
9287
567
231
3,358
937

(Amount truncated to millions of yen)

914,655

2,305
23,5002521,086
22,666
4,296
18,370Statement of Changes in Net Assets
From April 1, 2009
To March 31, 2010
(Unit: millions of yen)

Balance as of March 31, 2009
14,288Changes of items during
the period
Provision of reserve formine prospecting
Reversal of reserve formine prospecting
Reversal of reserve for
special depreciation
Reversal of reserve foradvanced depreciation ofnoncurrent assets
Provision of general reserve
Dividends from surplus
Net income
Purchase of treasury stock
Net changes of items other thanshareholders' equity
Total changes of items during－the period
Balance as of March 31, 2010
14,2883,572

399 16,948

72

283 47,246 141,600

3,572

Total shareholders’ equity

Treasury stock－－(3,443)

3,443

－

－

24－

－

11－

－

15,000 (15,000)－(2,286) (2,286)
18,370 18,370－(2,286)
18,370
(0)
(0)

1,256

(24)

(11)

－ 15,000(136) 16,084(0) 16,083

399 18,205

48

271 47,246 156,600

20,768 247,112(10) 261,390

Valuation and translation adjustments

Balance as of March 31, 2009
Changes of items during
the period
Provision of reserve formine prospecting
Reversal of reserve formine prospecting
Reversal of reserve for
special depreciation
Reversal of reserve foradvanced depreciation ofnoncurrent assets
Provision of general reserve
Dividends from surplus
Net income
Purchase of treasury stock
Net changes of items other thanshareholders' equity
Total changes of items during
the period
Balance as of March 31, 2010(9) 245,307(4,700)(11)－

20,904 231,027

4,700

(24)

－

Total retained earnings

Retained earnings brought
forwardGeneral reserve

Reserve for advanceddepreciation of noncurrent
assetsReserve for exploration

Reserve for special
depreciationReserve for mineprospecting

Reserve for overseas
investment loss

Legal retained earnings

Capital Stock

Shareholders’ equity
Retained earnings
Other retained earnings

Valuation
Total valuationdifference on Deferred gains orand translation
available-for-sale losses on hedges
adjustments
securities
105,684
105,684－

Net assets

350,991

－
－－
－

1,052

24

1,076

－
(2,286)
18,370
(0)
1,076

1,052

24

1,076

17,160106,73624

106,760

368,151(Amounts truncated to millions of yen)10